With the help of mortgage professionals, people are able to purchase their dream homes and begin building their financial futures. However, there have been some eye-opening statistics regarding mortgage professionals that have recently come to light, which can help both mortgage pros and consumers get a better understanding of the industry.
The first statistic involves the closing rate of mortgage leads. According to industry research, only 14% of all mortgage leads actually result in closed loans. This means that 86% of leads don't close for various reasons, including lack of interest or poor communication between the lender and customer. This statistic highlights the importance of having a strong lead generation strategy in place when targeting potential customers; it also shines a light on the importance of establishing a good rapport with customers in order to help increase the possibility of closing the loan.
The second statistic pertains to customer loyalty. According to recent studies, the percentage of consumers utilizing the same lender for more than one loan is just 9%. This indicates that customers may not be as loyal to their lenders as one might expect, which could be attributed to a variety of reasons. It’s important for mortgage professionals to consistently provide a high level of customer service in order to increase customer loyalty and create a positive reputation for their business.
Third, origination costs have risen significantly over the past few years. According to research, the average cost of originating a loan has risen by 33% from 2014 to 2019, while the number of loans being originated has remained mostly stagnant. This points to the increasing cost of doing business in this industry, which could be due to more competition among lenders or simply higher operation costs.
The fourth statistic is related to home buying trends. According to surveys, homebuyers are now looking for shorter loan terms (usually 15-year) as opposed to 30-year loans. This is likely due to the lower interest rates that are associated with shorter-term loans, and it's something mortgage professionals should be aware of when assisting buyers.
Finally, the fifth statistic deals with the rising popularity of non-QM loans. Non-QM loans, which are loans that don’t meet the traditional qualifications, have seen an increase in popularity over the past few years. This could be due to the fact that there are more opportunities and options for borrowers who don’t fit into the traditional mortgage model. It's important for mortgage pros to stay up to date on the different types of non-QM products that are out there in order to best serve their clients.
These five eye-opening statistics on mortgages are important for both mortgage professionals and consumers to be aware of. Understanding these statistics can help mortgage pros better understand the industry and what types of strategies they should be pursuing in order to stay successful. As for consumers, these statistics can help them make more informed decisions when it comes to selecting lenders and mortgage products.
This article was contributed on Aug 12, 2023
